Although transactions are increasingly executed online and using transaction cards, negotiable instruments continue to be used for executing transactions. Online transactions and transactions based on transaction cards are executed based largely on digital transaction data. A negotiable instrument, such as a check, includes an instruction of a customer a financial institution. The instruction may include an order instructing the financial institution to pay a sum certain to a payee.
A financial institution that is subject to an order to pay the sum certain may be a drawee. The customer that orders the drawee to pay the sum certain may be a drawer.
A check may be issued by the drawer completing a template. The template may include one or more segments. The segments may include pre-printed information. The pre-printed information may include an account number of the drawer. The pre-printed information may include a routing number associated with the drawee. The pre-printed information may be printed on a face of the template in magnetic ink. The magnetic ink may be readable by a device, such as an Automatic Teller Machine (hereinafter, “ATM”) that is capable of magnetic ink character recognition (hereinafter, “MICR”). The ATM may read MICR data recorded on a check and associate the check with a particular drawee and drawer.
A segment of the template may be completed by the drawer. The segment completed by the drawer may be completed by handwriting an entry. The ability to complete the template easily and simply by hand increases a versatility of a check. The drawer issuing the check only requires a writing instrument and the template to issue the check. An ability to issue a check without interacting with an electronic device may be a reason checks remain a popular mode of payment among drawers and payees. However, the popularity of checks has been accompanied by check fraud.
Check fraud may include a printing of a template that is not authorized by the drawer or the drawee. Check fraud may include completing a template without authorization from the drawer. Access to copies of a template and an ability to complete the template by handwriting entries may result in a first layer of complexity with respect to detecting a fraudulent check.
For example, MICR data is typically printed on the face of the check in plain view. A forger wishing to create a fraudulent check needs simply to obtain a copy of a check. Because the remaining segments of the template may be completed by hand, the handwriting of the drawer may be forged or imitated.
To detect the fraud, an analysis of handwriting on the check may be performed. To detect the fraud, it may be advantageous to cross-check and/or correlate various segments on an issued check. For example, a cross-check may include verifying that the MICR data printed on the check is validly associated with a name of a drawer printed on the face of the check.
A second layer of complexity may arise as a result of processing of a check by one or more financial institutions.
The payee may receive the check from the drawer. The payee may receive the check as payment for services or goods provided to the drawer. To convert the check into cash, the payee may present the check to a depositary financial institution (hereinafter, “depositary bank”). The depositary bank may provide financial services to the payee. A service provided by the depositary bank may include processing of a check issued by a drawer.
Processing may include receiving a check from the payee. Processing may include receiving a request from the payee to credit an account of the payee. The credit may correspond to an amount indicated in a segment handwritten by the drawer on the check.
The depositary bank may receive the check and transmit a copy of the check to the drawee. The depositary bank may request that the drawee transfer funds to the depositary bank. The funds may correspond to an amount indicated on the check.
Upon receiving the copy of the check, the drawee may attempt to assess an authenticity of the check. To assess authenticity, the drawee may attempt to detect a fraudulent check. A fraudulent check may be detected by examining one or more segments of the template. For example, upon inspection, a signature segment may include a signature that does not correlate to a known signature of the drawer. A visual inspection of the check may indicate that a numerical segment stating the amount may not correlate to a segment describing the amount in words. However, a visual inspection may be associated with time and labor costs.
The handwritten nature of a check may add complexity to detection of a fraudulent check. The complexity is further compounded by a sheer magnitude of checks that may be transmitted daily to a drawee.
A drawee may receive in excess of 25*106 checks daily. In view of the magnitude of checks, detecting a fraudulent check by a visual inspection of each check is not feasible. Furthermore, a visual inspection may not expose inherent defects of a fraudulent check. For example, a check may include a legitimate account number held at a drawee. However, a logo segment on the check may not correspond to a logo associated with the drawee.
Processing 25*106 checks daily may present an automated processing challenge. Computer-based deciphering of human handwriting may be a task that may require expensive and expansive computing resources.
In view of the challenges of detecting a fraudulent check, depositary banks and drawees may suffer a monetary loss. Furthermore, a depositary bank and, consequently, drawees, may be subject to regulations that require “clearing” of a check within a specified time window. The specified time window may restrict an amount of time available for the depositary bank or drawee to assess an authenticity of a presented check.
It would be desirable to provide a fraud detection system that utilizes distributed computing resources. It would be desirable to provide a distributed fraud detection system that includes analysis of segments of an issued check. It would be desirable to provide a distributed fraud detection system that includes analysis of handwritten segments on the issued check. It would be desirable to provide a distributed fraud detection system that includes expedited fraud detection analysis.
It would be desirable, therefore, to provide apparatus and methods for distributed processing of a check image.